Unregulated cryptocurrency thriving more than ever in Turkey - analysis

Turkish interest in cryptocurrency has gained traction after the abrupt firing of the central bank chief by the country’s president over the weekend, with investors rushing to save their depreciating liras, crypto news site CoinDesk reported on Wednesday.

Turkey does not regulate the trade of digital assets, the article highlighted, allowing its young tech-savvy population to operate free from licensing or concern for taxation.

The number of searches for Bitcoin spiked 566 percent in the hours immediately after the lira took a dive on Monday, according to data from Google trends. The currency had dropped 14 percent following the firing of a central bank governor by a late night presidential decree.

“Turkish investors and people who understand finance are really angry and saddened about what happened on Friday night,” CoinDesk cited Turkish investor Tilbe Yardım a.s. saying. “I decided to invest my money at least against inflation.” 

But Monday’s uptick in crypto searches is not a surprise, according to Ismail Hakki Polat, lecturer at the Kadir Has University in Istanbul.

“From the very beginning of bitcoin, Turkish people have been eager for and interested in cryptocurrencies so it’s not a new thing like in Venezuela or Argentina,” Polat told CoinDesk, referring to countries that have registered a dramatic growth in crypto use in a bid to stave off the effects of inflation.  

Inflation in Turkey rose to 15.6 percent in February and is expected to register higher in March and April due to the weak lira and rising food and oil prices.

Turkey’s two largest crypto exchanges, Paribu and BtcTurk, were trading over $1 billion worth of crypto daily, it said, and by Wednesday, 11 popular Turkish crypto exchanges in the country recorded a combined 24-hour trading volume of more than $6 billion. 

One reason for growth of the crypto market in the country is the absence of regulation, CoinDesk said.

“I think the regulations will eventually come, but not right now,” Polat told CoinDesk, noting that the central bank has other priorities at the moment, such as dealing with an economic and currency crisis.